Solar heat pumps (SHP) are a class of heating systems combining solar thermal technology with heat pumps. In this article the life cycle impact assessment (LCIA) of a SHP system used to produce domestic hot water (DHW) and space heating (SH) for single family dwellings is presented. This study intends to evaluate the environmental impacts of the energy and material used in a serial SHP installation and identify areas for improvement by applying a “cradle-to-grave” approach when analysing the system. This includes the installation materials both in their manufacturing and disposal phases as well as the energy consumption for DHW and SH throughout a service life of 20 years. In addition, it provides a comparison against two other residential heating systems operating with the same life expectancy. In this LCIA, two environmental related indicators are used, one associated with depletion of non-renewable energy resources (CEDNRE) and the other with climate change (GWP). The impact of the type of electricity used was also investigated by defining, in addition to the European supply mix, an alternative supply mix with electricity deriving from renewable sources. This study shows that SHP have lower environmental impacts than systems operating on electricity only. Installations with large solar collector surfaces are also seen to lead to lower energy consumption related impacts. If the electricity used by these systems derives from renewable sources, the environmental performance improves. However, under these conditions, the SHP impact (material and energy consumption) related to climate change will be of the same order as that of the electric system due to a higher contribution of the infrastructure content of these systems.